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James Murdoch Declines $6 Million Bonus

UPDATED: The News Corp. deputy COO will retain his $11.9 million salary and will consult over whether bonus payment is appropriate "at a later date."

LONDON -- On the day that a 15th person was arrested in the phone-hacking scandal that looks set to swamp both News International and the Murdoch family for months to come, James Murdoch has declined the $6 million bonus that he was awarded as News Corp. deputy COO.

"In light of the current controversy surrounding News of the World, I have declined the bonus that the company chose to award to me. While the financial and operating performance metrics on which the bonus decision was based are not associated with this matter, I feel that declining the bonus is the right thing to do. I will consult with the Compensation Committee in the future about whether any bonus may be appropriate at a later date," he said.

The news comes as attention in the phone-hacking scandal turns to evidence that will be heard next week from a group of News International executives who have contradicted James Murdoch's claim that he did not know the extent of phone-hacking at the paper when he was in charge.

Murdoch will likely face a recall to Parliament to clarify his evidence after the committee has heard from former colleagues including former News of the World editor Colin Myler, former News International legal manager Tom Crone, Jonathan Chapman, News International's former director of legal affairs and Daniel Cloke, former group director of HR. All have since left
News International.

Murdoch is also expected to be a key figure in the forthcoming judicial inquiry into phone-hacking headed by Lord Justice Leveson. He has not yet been involved in a criminal inquiry into activities at the paper, but his close ally Rebekah Brooks and former News of the World editor Andy Coulson have been arrested.

So far News Corp. chairman and chief executive Rupert Murdoch has given no hint that he will not take his own bonus of $12.5 million bonus, which takes his total remuneration for the year to $33 million.

The bonus and salary payments -- for the 12 months to the end of June 2011 -- were for a period when the London-based News International newspaper group became embroiled in a number of civil litigations alleging that staff on the News of the World had illegally intercepted phone messages. James Murdoch has been in charge of since 2009.

The mounting evidence emerging from the civil cases as well as a new police investigation proved catastrophic for News Corp. which closed down the 168-year-old News of the World as the firestorm and allegations of cover-up engulfed some of Rupert Murdoch's closest allies including former Wall Street Journal boss Les Hinton and Brooks, former chief executive of News International, who Murdoch publicly pledged to protect on multiple occasions before eventually being forced to let her go.

But most damaging for the 80-year-old News Corp. boss are the questions still facing his youngest son, a respected executive who was made chief executive of BSkyB in 2003 and left to become chief executive of News Corp.'s operations in Europe and Asia three years ago.

James Murdoch has already admitted to approving a seven figure payment to phone-hacking victim Gordon Taylor, chief executive of the Football Association, but until recently had held to the line that phone-hacking was not widespread.

The mounting evidence to the contrary, as well as allegations of a major corporate cover-up, look set to occupy News Corp.'s most senior executives for months to come as well as proving a public relations disaster for the company behind some of the biggest entertainment and media brands in the world.